Four Other Reasons Obama Won

America has spoken, and this long, thrilling election is finally over.

And we now have—I almost can't believe I'm writing this—the first black president of the United States.

That fact, of course, dwarfs all others. Through a brilliant campaign and his own preternatural calm in the face of—well, everything—freshman Senator Barack Obama overcame all the odds and persuaded tens of millions of Americans that he could guide the nation through two wars and the worst financial crisis since the Great Depression.

Far more eloquent people than I have analyzed what this means for America and the world. But I think all of us can agree—no matter how we voted in this election—that Senator Obama's election is a huge step in moving beyond the specter of slavery and racism that has haunted our nation from its conception. Senator John McCain addressed that directly in his thoughtful, gracious concession speech Tuesday night.

And many prominent pundits already have cited the economy, the deep unpopularity of the Bush Administration, and the overwhelming belief that the country is on the wrong track as the reasons for Senator Obama's astonishing victory.

But let's not overlook four other factors I believe played a major role in Sen. Obama's victory.

1. The investor class jumped ship. Exit polls showed Sen. Obama handily defeating Sen. McCain among upper-middle-class and white suburban voters. Senator McCain probably prevailed slightly among self-described "investors," if the actual voting followed late tracking polls. (He was up five points among investors in a late Reuters/C-Span/Zogby Poll, and almost even with Sen. Obama in the final IBD/TIPP poll.)

But that was significantly lower than in 2004, when investors voted overwhelmingly for President Bush over John Kerry—by 61% to 36%, according to Zogby International. We were just a year and a half into a bull market then, and stocks were rising nicely.

This year, the financial crisis and market crash have devastated investors, many of whom suffered huge losses in their 401(k)s and other accounts. Combined with falling home prices, that has reduced household net worth and led many people to feel, well, poorer.

So, it was no surprise that as the market meltdown continued and people saw the massive red ink on their brokerage and fund statements, support for Sen. McCain shrank among investors, enabling Sen. Obama to make deep inroads into a traditionally Republican constituency.

2. Taxes don't matter as much. Sen. McCain did get some traction in the campaign's closing days with his arguments that Sen. Obama's tax plans involved redistribution of wealth—but not enough to narrow the gap.

The reason: Sen. Obama was able to persuade most Americans they would get a tax cut under his plan. And an independent analysis done for the New York Times said that even for a household (two adults and two children) earning $500,000 a year, the additional taxes would be $3,000 annually (if Congress enacts just his plan and nothing more—a big "if"). If the exit polls are right, that didn't deter high-income people from voting Democratic this year.

The economy has clearly overshadowed the issue of higher taxes among the voting public. Exit polls showed nearly half of all voters expected their taxes to rise no matter who was elected president.

As for the prospect of higher capital gains taxes, who has any capital gains to tax this year? And half of Americans own stock through retirement plans, which aren't subject to capital gains taxes anyway.

3. Falling oil prices hurt the Republicans. When Sen. McCain picked Governor Sarah Palin of Alaska to be his vice-presidential nominee, gasoline prices were still around $3.60 a gallon, and $4.00 gas was still fresh in people's minds. Gov. Palin's experience with energy issues and her strong "drill, baby, drill" platform enhanced her appeal among voters, who strongly supported offshore drilling.

But as oil plunged below $70 a barrel and gasoline prices dropped to $2.50 a gallon, the issue lost its sting. That cost the McCain campaign a potentially winning economic issue, depriving Gov. Palin of what had been a strong suit, so she became a bigger and bigger drag on the ticket among independent voters

4. The evolution of the Internet helped Obama. Democratic insurgents pioneered the use of the Internet in the 2004 Howard Dean campaign for president, and candidates from both parties have used it to collect campaign contributions, post position papers, and sign up volunteers.

But the Obama campaign took it to a whole new level, helped by the emergence of Web 2.0 and the mobile Internet, which existed in a much more primitive form back in 2004.

Social networking sites like Facebook and MySpace, text messaging, and cutting-edge Web design helped make the Obama campaign the most formidable fund-raising machine in American history, raising over $600 million-some 90% of that total from individuals.

The campaign's highly sophisticated use of wireless technology and the Internet helped it communicate with millions and mobilize the Millennial generation (18 to 29 year olds), who voted overwhelmingly for Sen. Obama and who live with technology the way fish live in the sea.

So, what now? Sen. Obama's victory was historic, but as the table below shows, the margins of victory don't approach those of historic landslides (like Franklin D. Roosevelt in 1932 or Ronald Reagan in 1980) that marked fundamental electoral realignments.

As of Wednesday morning, the Democrats have picked up five Senate seats, with some others still in contention. It's likely they'll fall short of the 60-vote supermajority required to halt debate in the upper chamber.

And they appear to have nabbed 20 additional seats in the House of Representatives, a nice increase that continues the gains they made in 2006, but not quite the dominance they were hoping for.

Clearly, voters were willing to entrust Sen. Obama with the White House, but they weren't quite ready to turn over the keys to Capitol Hill, too.

Americans have clearly voted for change. They will give the president-elect and new Congress a long honeymoon to help clean up the mess we're in.

But politicians from both parties should take note: The people want results, and they won't tolerate a lot of bickering or posturing. And the skin color of whom they elect no longer matters—as long as he or she delivers.

Given our history, that is a transformation indeed.

Howard R. Gold is executive editor of MoneyShow.com. The views expressed here are his own and do not necessarily reflect the opinions of InterShow or MoneyShow.com.